FINANCIAL MANAGEMENT INTERNAL CONTROL PROCEDURES IN SECONDARY SCHOOLS PRESENTED BY MURAYA KARIUKI AT EDEN ROCK MALINDI DISTRICT SCHOOLS AUDITOR MALINDI

FINANCIAL MANAGEMENT PROCESS Budgeting Receiving of revenue Procurement Expenditure Reporting

BUDGETING INTERNAL CONTROLS Ensuring that budgets are prepared, discussed and approved prior to implementation in the preceding year. Ensure that all additional levies charged by the school are approved by the deb. Organizing BOM meeting to discuss and approve annual budgets. Institute measures to ensure smooth budget implementation and follow ups.

REVENUE RECEIPT INTERNAL CONTROLS Ensuring that the school maintains the recommended bank accounts. main, tuition and operations banking all revenues collected in the institution before spending. Ensuring that all receipt books are stamped and registered in the DEO’s office and are recorded in the counterfoil receipt book register. Ensuring that only one receipt book is in use at a time. Safe custody of unused receipt books ad Lpo/Lso

REVENUE RECEIPT INTERNAL CONTROLS Checking daily revenue collections from the receipt book and signing against the daily revenue breakdown analysis. Limit cash collection points and personnel dealing with receipt of cash. All cash received in the school should pass through the schools official receipts

EXPENDITURE INTERNAL CONTROLS Authorizing all payment vouchers and contract agreements. Ensuring that all payment vouchers are serially numbered. Making sure that all items delivered to the school are accompanied with delivery notes and are promptly entered in the relevant stores ledgers Directing that the statutory deductions i.e.NSSF, NHIF,PAYE are remitted 0n time to avoid penalties

EXPENDITURE INTERNAL CONTROLS Ensuring that imprests are surrendered promptly after the return of official journeys or task completion Undertaking one development project at a time before embarking on another one. Preparing project appraisal reports on completion of earmarked projects

REPORTING INTERNAL CONTROLS Checking the cash book periodically to confirm whether it has been updated. Making sure that trial balances are prepared at every end month and submitted to the relevant offices by 15 th of the ensuing month. Ensuring books of accounts are submitted for audit by 31 st January of every year(it’s the responsibility of the school to prepare financial statements ie income and expenditure and balance sheet). Discussing Approved audited accounts with BOM Deut 15:13,14, Matt5:25.26

PROCUREMENT INTERNAL CONTROLS Appointing the relevant procurement committee in writing as per the procurement regulations tender committee,inspection commiitee,evaluation comittee,infrastructiure committee. Ensuring that tender committee minutes are properly written and filed. Ensuring that public procurement regulations are adhered to

IMPORTANCE OF A TRIAL BALANCE Acts as a tool for expenditure control Controls spending as per vote head Helps management gauge the schools financial position Helps monitor the flow of funds in and out of the institution

TRIAL BALANCE DISTRIBUTION principal secretary moest district education officer county director of education district schools auditor(hand delivery) Tsc unit school copy

Emerging trends Ensure that working budgets are available Expenditure to be pegged on the budget allocation Use of budget as a tool of expenditure control Funds received for specific accounts to be accounted for in those accounts Ensure 60% collection of fees in first terms Inter account transfer between tuition account discouraged

Emerging trends Ensure that inter account transfers from main account and operations account have reasons for transfer,and balanced at the end of the year, Transport and subsistence to be accounted for using a specified schedule and a bog resolution minute Pta funds to be used wholly for development as per budgets

Emerging trends Control over commitment in creditors. Have qualified personnel manning core depts. Staff employment to be based on approved establishment. Clearly state and display the duties of all non teaching staff in your payroll Use trial balance as a monitoring tool, Imprest system to be streamlined and prompt surrender adhered to. Onsite audit of books of Accounts launched.

Emerging trends All schools to have service gratuity account and transfer funds for P/E as it is received from MOE. Bank overdrafts not allowed in school. Full disclosures of bank accounts operated by the school. Involve the PTA in the signing of cheques. Minimum of three bank signatories with principals sign mandatory. Support training of bursars and accounts clerks for better accounting processes.

Emerging trends Daily transport and subsistence schedule format S/N O DATENAMEDETAILSTSC/IDAMOUN T SIGN

…… THE END…… GOD BLESS YOU GOD BLESS KENYA